Finch, Inc

question 96

Essay

Finch, Inc. has bought a new server and must decide what to do with the old one. The cost of the old server was originally $60,000, and it has been depreciated $45,000. The company has received two offers. One offer was made to purchase the equipment outright for $18,500, less a 5% sales commission. The other offer was to lease the equipment for $7,000 for the next five years, but the company will be required to provide maintenance and insurance totaling $3,000 per year. What offer should Finch, Inc. accept?

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Definitions:

Percentage Change

A mathematical calculation that describes the degree of change over time, usually expressed as a percentage to indicate an increase or decrease.

Negative Balance

A situation where the account balance is below zero, indicating that money is owed.

Percentage Increase

The rate at which a specific quantity grows over a particular period of time, expressed as a fraction of the initial value.

Sales Data

Information related to the sales performance of a company, including volume, trends, and geographical distribution of sales.